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The risk-off sentiment contained the opening of 2016

Discussion in 'Current Market Sentiments' started by fx-recommends, Jan 4, 2016.

  1. fx-recommends

    fx-recommends Content Contributor

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    USDJPY Daily 04-01-2016 05-06-34 ص.jpg
    The first Asian session of the year opened under selling pressure to send Nikkei 225 down more than 300 points in the beginning hour of the week following the plunge of the US equities indexes by the end of last week following massive falling of Dec Chicago Manufacturing PMI to the lowest level since June 2009 reaching 42.9, while the market was waiting for rebounding to 49.8 from 48.7 in November.

    The release of Dec Chinese NBS Manufacturing PMI came also during the weekend to restore the worries about the Chinese economy by showing limited improving to 49.7, while the market was waiting for 49.8 from 49.6 in November. It is the fifth consecutive reading in the contraction territory below 50.

    With this dovish market sentiment, The Japanese yen could appreciate across the broad as this lowest cost financing currency usually finds more buying with unwinding of the carry trades during the risk-off sentiment.

    The markets will be waiting today for the release of Dec Manufacturing PMI of EU and UK and also the release of Dec US ISM Manufacturing Index which is expected to improve to 49, after its first falling below 50 since May 2013 to 48.6 last November.

    After USDJPY could have the ability to hold above 120 psychological level by the end of last year, it came under increasing downside pressure following breaking of it to be now below 119.60 supporting level which could prop it up on last Oct. 22.

    The pair daily Parabolic SAR (step 0.02, maximum 0.2) is reading now 122.78 in its seventh consecutive day of being above the trading rate.

    USDJPY came under technical pressure, after ending side way of trading between 121.21 and 123.74 by breaking its lower band at 121.21 and after failing to reenter this trading barrier, it formed another lower high at 120.64 to fall further.


    Important levels: Daily MA50 @ 121.88, Daily MA100 @ 121.10 and Daily MA200 @ 121.61

    S&R:
    S1: 119.60
    S2: 118.05
    S3: 116.15
    R1: 120.64
    R2: 121.49
    R3: 123.74


    Have a good day

    Walid Salah El din
    Senior Market Analyst
    Skype : chief.economist.walid

    walid.s@trade-24.com
    Tel: UK. +44 1138590277
    Mob: EGY. +20 1224659143
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    http://www.trade-24.com/daily-analysis

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